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The Hong Kong Monetary Authority cautions the public on overseas crypto firms falsely claiming to be banks, urging caution as such claims may violate local banking laws.
Hong Kong‘s financial regulator, the Hong Kong Monetary Authority, warning against overseas crypto firms misrepresenting themselves as licensed banks in a Nov. 15 press release, saying such firms may be violating local regulations by using the word “bank” in their product descriptions or marketing materials.
The HKMA highlighted two overseas crypto firms that recently held activities in Hong Kong. One firm was reported to have referred to itself as a “bank,” while the other described its card product as a “bank card” on its website.
The authority expressed concern that these representations could “mislead consumers to believe they are licensed banks in Hong Kong and are under the HKMA’s supervision, and such products and services are provided by licensed banks in Hong Kong.”
Under Hong Kong’s Banking Ordinance, only licensed banks, restricted license banks, and deposit-taking companies, collectively known as authorized institutions, are permitted to carry out banking services in the city. The use of the term “bank” by any entity outside of these institutions is a violation of the law, the HKMA added.
The HKMA reminded the public that crypto firms, even those operating under the name of “bank” or claiming to be “crypto banks,” may not be licensed in Hong Kong. Products or services using “bank” in their names are not necessarily provided by licensed banks in the jurisdiction, the regulator emphasized.